Cerasis is by legal definition a freight broker. Although our claim to fame is our web based TMS freight rating technology, the Cerasis Rater, which includes a technology suite of products and integrated managed transportation services, it is in our interest to understand the future of freight and how we as freight brokers fit in. Even if you yourself only manage freight and are responsible for all that goes into transportation, logistics, or supply chain at your company, it is also vital for you to understand how companies like Cerasis and other freight brokers will fit in as we see into the future of freight. As a shipper, you must understand how changes to the freight broker world might affect your rates and understand the transparency of the freight broker you use to see how it impacts them. If you are not asking, you definitely should.
The future of freight and how brokers fit in looks quite bright.
How Will those who Manage Freight and Freight Brokers Fit into the Future of Freight?
As a freight broker or if you manage freight for a business and are in charge of shipping, you’ve got a lot to juggle. In addition to monitoring everything from global fuel prices to new technologies, you have to stay on top of the latest legal changes. But while resources like an up-to-date freight broker bond guide can get you through those legal challenges, the rest can be a bit more complicated.
Fortunately, there are still plenty of resources out there to give you the insights you’ll need to flourish in 2016 and beyond. The world of freight brokers and the future of freight is changing quickly, so it’s time to watch those trends to understand how you need to adapt. Here are some of the biggest changes on their way.
Self-Driving Trucks: Closer and Closer to Reality
This is certainly one of the biggest and flashiest changes coming to the world of freight. While the arrival of this technology seems inevitable, the big questions brokers have to ask themselves are how quickly it will come and how precisely it will affect their side of the business.
The basics of this technology already exist, but how quickly it will change the industry? The first licenses for autonomous vehicles have been issued in Nevada, but the first round of vehicles requires a human driver to be present. Fortunately for drivers, this will likely be the case for years to come.
These changes will be accelerated by the fact that decreasing numbers of applicants for truck driving positions are already pushing wages up. The financial incentives to invest heavily in this technology are present. But how will they influence the future of freight and freight brokers like Cerasis?
Autonomous Technology and Freight Brokers
The good news in the future of freight is that autonomous vehicle technology offers more of what freight brokers love and can then pass onto their shipper customers: reliability, lower costs, and data. By offering potentially dramatic cuts in costs and road accidents, brokers will be able to increase the reliability of shipments, leading to a more predictable industry.
Data collected from the new technology also promises to result in big changes. The kinds of computers that will be integrated into autonomous and self-driving vehicles will likely be capable of providing more data than ever to brokers and freight companies. This information will help in predicting shipping times and cutting costs.
Overall, autonomous technology and self-driving trucks are shaping up as a very positive development for freight brokers. However, the unpredictability of the legal situation regarding authorization and regulation of autonomous vehicles continues to leave the future uncertain.
The Dangers of Legal Leaps
In the short term, legal changes can have a huge effect on the freight world and freight brokers. For evidence, you can look to the BMC-84 freight broker bond changes that occurred in 2013. The biggest legal change on the horizon at this moment is a massive rise in insurance premiums for freight brokers. Currently, the insurance minimums haven’t changed since 1985 and the FMCSA (Federal Motor Carrier Safety Administration) seems likely to make significant changes in the coming years.
Much like with bond amounts, this is another example where federal mandates can stay the same for decades before making all the required changes in a single leap, causing a minor shock in the industry.
The good news is that these changes are generally obvious months or even years before they happen, giving freight brokers ample time to prepare. However, legal changes and updated regulations (particularly in light of the arrival of autonomous vehicles) can create a huge grey area for the future of freight brokers.
But factors changing the industry extend far beyond the US.
Fuel Prices: The Perpetual X-Factor in the Future of Freight
The world of fuel prices for those shipping freight and for freight brokers has always been a strange combination of long-term thinking and short-term crisis management. In the long term, market trends are fairly foreseeable. At the moment, it’s expected that lower fuel costs should continue as domestic fracking and OPEC production keep things stable in the US.
This only tells a part of the story, though. Just one sudden crisis always has the capability to send the price of oil skyrocketing, leading brokers to throw out their predictions entirely. These are the less predictable risks: wars, blockades, market shifts, etc.
While global economic integration continues, freight brokers, logistics managers, transportation coordinators and anyone in the freight industry would do well to pay even closer attention to factors that could bring about changes in fuel prices, sudden or otherwise.
What Does the Future of Freight and Brokering Look Like?
Taking a wider view, things still look as rosy for freight brokers as they did at the beginning of 2015. While legislation and technology seem set to change the trucking industry, freight brokers stand to benefit tremendously from these changes.
While there are still lingering concerns over infrastructure investment and global instability, for now, the industry seems sufficiently insulated from these concerns. Freight brokers still have many reasons to be optimistic. So stay smart, keep track of technology and industry trends, and enjoy the rest of 2015.